Shri Manibhai Gandhi and Shri Naginbhai Shah, the members of Legislative assembly, visited the Swaminarayan Gurukul at Gandhinagar with the sole aim of establishing a Swaminarayan Gurukul in Bhavnagar. They were impressed by the various activities of the Gurukul there.

The disciple of Shri Purani Swami Haripriyadasji, the founder of Gandhinagar Gurukul. Shri Purani Swami Shri Narayanpriyadasji was requested to come to Bhavnagar and start the Gurukul here and were assured that they will help them in getting the land for the Gurukul.Considering the request, Purani Swami Shri Narayanpriyadasji came to Bhavnagar and made an application for acquiring land.

Shri Naginbhai Shah requested for a bank balance of Rs.10.00 lacs but he told that the devotees are real bank balance and ultimately the application was accepted and sanctioned.

The land which was graced by Shriji Maharaj and on which was held the mahaadhivation of the congress during the time of Shri Pandit Jawaharlal Nehru, at Sardarnagar, approximately 15000 square yards at a token rate was obtained and the foundation stone of Shri Swaminarayan Gurukul was laid on 18th Feb,1978 at Sardarnagar.

Late Shri Morarjibhai Desai was to lay the foundation stone but due to the emergency laid by Mrs. Indira Gandhi, he was sent to jail and hence the foundation stone was laid by the former Chief Minister of Gujarat, Late Shri Babubhai Jashbhai Patel, and the institution has developed and progressed since then.